Just Energy Announces $100M Public Offering Of Convertible Unsecured Senior Subordinated Debentures
Just Energy Group Inc. (“Just Energy” or the "Company") announced that it has entered into an agreement with a syndicate of underwriters (the “Underwriters”), pursuant to which Just Energy has agreed to issue, on a “bought deal” basis, CAD $100,000,000 aggregate principal amount of convertible unsecured senior subordinated debentures (the “Debentures”) at a price of CAD $1,000 per Debenture (the "Offering"). The Debentures will bear interest from the date of issue at 6.75% per annum, with interest payable semi-annually in arrears on March 31 and September 30 of each year (each an "Interest Payment Date") commencing on September 30, 2018. The Debentures will mature on March 31, 2023 (the "Maturity Date").
Just Energy has granted to the Underwriters an over-allotment option (the “Over-Allotment Option”) to purchase up to an additional CAD $15,000,000 aggregate principal amount of Debentures at the same price, exercisable in whole or in part at any time for a period of up to 30 days following closing of the Offering, to cover over-allotments.
Just Energy intends to use the net proceeds from the Offering to redeem the Company’s 5.75% Unsecured Subordinated Convertible Debentures due September 30, 2018 (the “2018 Convertible Debentures”) following closing of the Offering, and to use the excess, if any, for general corporate purposes.
Each CAD $1,000 principal amount of the Debentures will be convertible at the option of the holder at any time prior to the close of business on the earlier of the Maturity Date and the last business day immediately preceding the date fixed for redemption, into 112.3596 common shares of Just Energy, representing a conversion price of CAD $8.90 per common share (the "Conversion Price"), subject to certain anti-dilution provisions. Holders who convert their Debentures will receive accrued and unpaid interest for the period from and including the latest Interest Payment Date to, but excluding, the date of conversion.
The Debentures will not be redeemable at the option of the Company on or before March 31, 2021. After March 31, 2021 and prior to March 31, 2022, the Debentures may be redeemed in whole or in part from time to time at the option of the Company on not more than 60 days and not less than 30 days prior notice, at a price equal to their principal amount plus accrued and unpaid interest, provided that the weighted average trading price of the common shares of Just Energy on the Toronto Stock Exchange (the “TSX”) for the 20 consecutive trading days ending five trading days preceding the date on which the notice of redemption is given is at least 125% of the Conversion Price. On or after March 31, 2022, the Debentures may be redeemed in whole or in part from time to time at the option of the Company on not more than 60 days and not less than 30 days’ prior notice, at a price equal to their principal amount plus accrued and unpaid interest.
The Debentures will be offered by Just Energy in each of the provinces of Canada by way of a prospectus supplement to the Company’s short form base shelf prospectus dated January 4, 2018. Closing of the Offering is expected to occur on or about February 22, 2018. Completion of the Offering is subject to the satisfaction or waiver of various conditions, such as the receipt of normal regulatory approvals, including approval of the TSX and the New York Stock Exchange and the consent of Just Energy’s lenders.